Gujarat, Goa, Arunachal Pradesh Take Top Spots in DPIIT’s Startup Ranking

Gujarat was crowned the best performing startup ecosystem in the country for the fifth time in a row, as per the Department for Promotion of Industry and Internal Trade’s (DPIIT) fifth edition of the ‘States’ Startup Ecosystem Ranking’.

The initiative, which is a part of the ‘Start Up India’ scheme, evaluates the efforts of different states and union territories (UTs) in building a startup ecosystem conducive to supporting new ventures and entrepreneurs.

Gujarat ranked the highest (between 90-100 percentile) in category A , which included all states and UTs with a population of over 1 Cr. Interestingly, New Delhi ranked the lowest in the category.

Top performers (between 70-89 percentile) in the category included Karnataka, Punjab, Tamil Nadu and Uttar Pradesh, and ‘leaders’ (between 50-69 percentile) included Rajasthan, Kerala, Madhya Pradesh, Uttarakhand, Telangana, Maharashtra, Andhra Pradesh and Haryana.

Additionally, Odisha, Assam, Bihar and Jammu & Kashmir were ranked as ‘aspiring leaders’ (between 30-49 percentile) while Chhattisgarh and NCT of Delhi were labelled as ‘emerging startup ecosystems’ (up to 30 percentile).

In category B, which included states and UTs with a population of less than 1 Cr, Arunachal Pradesh and Goa topped the list as ‘best performers’, followed by Himachal Pradesh being recognised as a ‘top performer’ and Manipur, Nagaland and Meghalaya as ‘leaders’.

The ‘aspiring leaders’ in this category included Mizoram, Sikkim, Tripura and Andaman and Nicobar Island, whereas the UTs of Puducherry, Chandigarh, Ladakh, Lakshadweep, Dadra and Nagar Haveli and Daman and Diu were all labelled as ‘emerging startup ecosystems’.

How The Rankings Were Decided

The 34 states and UTs that participated in the survey were ranked on the basis of parameters like institutional support, infrastructure, funding opportunities, market access and reach, ecosystem capacity building and focus on innovation and sustainability.

These parameters were divided into further action points and indicators, like implementation of startup policies, existence of infrastructure like incubators, labs and R&D centres, volume and value of PE and VC deals in a state, access to education and mentorship, and diversity, inclusion and sustainability efforts.

The fifth edition had three major pillars of the framework – 75% weightage was given to documents submitted by states and UTs, 15% to feedback received from startups across states and UTs, and the remaining 10% weightage was for private ecosystem mapping. The consideration period for the fifth edition of the rankings was January 1, 2023 to November 30, 2024.

Apart from the DPIIT, industry bodies like FICCI, NASSCOM and CII were also part of the evaluation panel, along with private players like Google and Zerodha’s Rainmatter fund.

Wider access to and education on initiatives by state governments to nurture their startup ecosystems was one of the key demands, the report found. Stronger institutional support in terms of seed grants and working capital, inclusion of service-based startups in incentive frameworks and expanding support for IP protection, patent filing and R&D assistance were also demands put forth by ventures surveyed for the report.

The report comes at a time when India is currently the third largest startup ecosystem in the world, with over 2 Lakh DPIIT-registered startups. The country celebrated 10 years of ‘Start Up India’ initiative and the fifth National Startup Day yesterday.

As part of the Startup Day celebrations, Prime Minister Narendra Modi called on entrepreneurs to focus on manufacturing and advanced technologies over the next decade to gain a foothold in global markets and supply chains.

The PM noted that while digital and service-based ventures have made great progress, startups must work toward improved manufacturing and technological capabilities in order for the Indian startup ecosystem to gain global recognition. This, he said, would also have a direct and marked impact on economic growth and employment opportunities in the country.

Highlighting the Centre’s continued support for AI-led initiatives, PM Modi noted that accelerating development in the AI space now will help the country gain global recognition. He also noted the government’s efforts to support key sectors like semiconductors, data centres and green hydrogen.